PayPal buys Israeli security firm

PayPal is paying $170m for an Israeli security analysis company called Fraud Sciences Limited.

Fraud Sciences' risk products will be used on PayPal and eBay sites. This is likely to be welcomed by many PayPal users who do not consider the company does enough to protect them against fraud.

Several Fraud Sciences staff will move to PayPal including the current chief operating officer and two company founders. Fraud Sciences CEO Gadi Maier will help out with the transition period.

Fraud Sciences claims to differentiate between fraudulent and genuine transactions, presumably by weighing various risk factors like how much the transaction is for, what kind of thing is being bought and where the delivery address is.

The deal should close in the next 30 days, and eBay does not expect any impact on earnings. ®